SGX Has Robust Framework as a Self-Regulatory Organisation
6 January 2009
We refer to the letter from Mr. Mak Yuen Teen, ‘Thoughts on SGX’s regulatory stance’ (BT, Dec 23, 2008).
Singapore is not unique in having a listed exchange that is also the frontline regulator responsible for preserving a fair, orderly and transparent marketplace. Other leading exchanges, listed or otherwise, are also commercial entities that promote their businesses and regulate their markets.
Mr. Mak cited the Australian Securities Exchange (ASX) as an example. ASX deals with regulatory conflict by establishing a separate subsidiary to manage day-to-day supervisory functions. Overall policy is still decided by a Policy Committee which includes ASX executives. The Board of the supervisory subsidiary is made up of some directors who hold concurrent directorship on the main board of ASX.
The International Organisation of Securities Commissions (IOSCO) has endorsed the World Federation of Exchanges (WFE) view that there is no ‘one size fits all’ solution and that regulatory responses may vary.
In Singapore, we have a Regulatory Conflicts Committee (RCC) made up of independent directors within the SGX Board. Its function is to oversee the handling of regulatory conflicts within SGX and make decisions on specific cases of SRO conflicts as required.
The regulatory arm of the SGX as contained in Risk Management and Regulatory Group (RMR) reports on conflicts governance and resourcing to the RCC, which in turn accounts for its actions annually to the Monetary Authority of Singapore (MAS), our statutory regulator.
SGX gives highest priority to developing an enduring marketplace through not just commercial capabilities, but also regulatory excellence. SGX’s regulatory and commercial objectives are not divergent. High regulatory standards are the cornerstone for maintaining market integrity and confidence. SGX recognises the importance of managing both perceived and actual conflicts of interest as a self-regulatory organisation (SRO).
We have established a robust framework of checks and balances. An internal handbook covering the management of SRO conflicts for both commercial and regulatory functions of the Exchange, supported by comprehensive training and awareness, reinforces our SRO governance framework. Details can be found in our annual reports and on our corporate website.
Yeo Lian Sim Senior executive vice-president Head, Risk Management and Regulation Group Singapore Exchange Limited
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SGX Has Robust Framework as a Self-Regulatory Organisation
6 January 2009
We refer to the letter from Mr. Mak Yuen Teen, ‘Thoughts on SGX’s regulatory stance’ (BT, Dec 23, 2008).
Singapore is not unique in having a listed exchange that is also the frontline regulator responsible for preserving a fair, orderly and transparent marketplace. Other leading exchanges, listed or otherwise, are also commercial entities that promote their businesses and regulate their markets.
Mr. Mak cited the Australian Securities Exchange (ASX) as an example. ASX deals with regulatory conflict by establishing a separate subsidiary to manage day-to-day supervisory functions. Overall policy is still decided by a Policy Committee which includes ASX executives. The Board of the supervisory subsidiary is made up of some directors who hold concurrent directorship on the main board of ASX.
The International Organisation of Securities Commissions (IOSCO) has endorsed the World Federation of Exchanges (WFE) view that there is no ‘one size fits all’ solution and that regulatory responses may vary.
In Singapore, we have a Regulatory Conflicts Committee (RCC) made up of independent directors within the SGX Board. Its function is to oversee the handling of regulatory conflicts within SGX and make decisions on specific cases of SRO conflicts as required.
The regulatory arm of the SGX as contained in Risk Management and Regulatory Group (RMR) reports on conflicts governance and resourcing to the RCC, which in turn accounts for its actions annually to the Monetary Authority of Singapore (MAS), our statutory regulator.
SGX gives highest priority to developing an enduring marketplace through not just commercial capabilities, but also regulatory excellence. SGX’s regulatory and commercial objectives are not divergent. High regulatory standards are the cornerstone for maintaining market integrity and confidence. SGX recognises the importance of managing both perceived and actual conflicts of interest as a self-regulatory organisation (SRO).
We have established a robust framework of checks and balances. An internal handbook covering the management of SRO conflicts for both commercial and regulatory functions of the Exchange, supported by comprehensive training and awareness, reinforces our SRO governance framework. Details can be found in our annual reports and on our corporate website.
Yeo Lian Sim
Senior executive vice-president
Head, Risk Management and Regulation Group
Singapore Exchange Limited
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